WASHINGTON, Oct 17 (Reuters) - A U.S. regulatory council announced on Wednesday it had removed the systemically risky label from Prudential Financial, freeing the insurance company from more rigorous oversight by the Federal Reserve.

The decision by the Financial Stability Oversight Council could cut regulatory costs at Prudential, which no longer will have to meet enhanced capital and liquidity standards and comply with Fed regulators. It also means regulators no longer consider any nonbanks to pose a threat to the entire financial system.

"We are pleased with this decision, which affirms our longstanding belief that Prudential never met the standard for designation," the company said in a statement.

The move by the FSOC, a regulatory panel composed of top Trump administration regulators charged with monitoring the financial system for looming threats, had been widely expected.

Prudential was the only remaining nonbank to be considered a "systemically important financial institution" meriting tougher oversight. The FSOC discussed the company's status at a closed meeting Tuesday.

Treasury Secretary Steven Mnuchin, who chairs the FSOC, said the decision was based on "a detailed analysis showing that there is not a significant risk that the company could pose a threat to financial stability."

Regulators were given the power to identify single firms as potential threats to the entire financial system under the 2010 Dodd-Frank financial reform law. The Obama administration identified a handful of nonbanks as systemic, but Wednesday's announcement means no nonbanks will be subjected to that sort of oversight going forward.